Exhibit 2-19 Production possibilities curves
-In Exhibit 2-19, the production possibilities curves for a country are shown for the years Year X and Year Y. Which of the following could have caused a shift for Year X to Year Y in production possibilities curves?

Question

Exhibit 2-19 Production possibilities curves 
-In Exhibit 2-19, the production possibilities curves for a country are shown for the years Year X and Year Y. Which of the following could have caused a shift for Year X to Year Y in production possibilities curves?

Quizplus · Accepted Answer

A shift from Year X to Year Y in the production possibilities curve could be caused by an increase in the stock of capital goods, which would allow for more efficient production and an increase in the production possibilities of the country. The other options - unemployment, decline in technology, natural disaster, and more efficient production - could affect the actual production level of the country, but would not necessarily cause a shift in the production possibilities curve.

Exhibit 2-19 Production Possibilities Curves